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plummet expert

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Posts posted by plummet expert

  1. He's right, but it needs a slight correction. When he says "High taxes have helped make Britain uncompetitive."

    No. High housing costs have made British people too expensive to employ. That's where our un-competitiveness stems from.

    CORRECT, CORRECT CORRECT! THAT'S WHY IT IS ESSENTIAL TO PUT UP INTEREST RATES AND BRING DOWN HOUSE PRICES. ESSENTIAL TO ENFORCE A LENDING MULTIPLE FOR ALL LENDING BY LAW AT 2.5 X FIRST INCOME AND 0.5 X SECOND - WHETHER IT BE PRIME OR SUBPRIME MORTGAGES. Fractional reserve banking should be more tightly controlled. All tax cutting should be to support manufacturing and exporting business.

    If we did this, in a space of 2 years the entire landscape would alter. Savers would be rewarded. Land values would fall significantly. Building SENSIBLY PRICES HOMES for sale or rent would increase. Jobs in construction would flow. Wage push inflation would reduce to nil or negative. Our competitiveness would improve over time and our standard of living. The losers would be those who bought recently and those sitting on vast, unexpected, unearnt equity they don't need and won't miss in the new cheaper to live in world these policis would create.

    We are indeed living with A TORY CHANCELLOR who knows little more than Gordon Brown. QE is ruining our economy. Mr Carney as Governor of the B of E.....Oh god, don't start me off.

  2. Really? Sure people moan but they don't do anything and most people are not really affected by the so-called austerity. House prices are going up (Halifax said so today) more people are working than ever before. People might be a few quid worse off but so what. Nothing will happen ... might have the odd August style looting but they have probably learnt that if they do this then they will get jailed for a year if they steal a bottle of water, so again won't happen.

    Carney will come have some funding scheme to generate 'growth' and it will work for a short while and then before the effects come through then he will disappear back across the pond. Short term measures are very easy and that is why this is all they do, the difficult things such as building a real economy takes too long. Easier to say introduce tax relief on mortgages, provide cheap debt and then the spending creates 'growth'. Like getting a second credit card allows increases your 'wealth and prosperity' until the credit limit is reached.

    History will cast Carney as a disaster for Canada nd the UK.

  3. Like everyone else I have opinion, not answers.

    I don't see us being any different from other Western economies. We're all fooked and we're all printing. I don't see the bond market forcing anything against UK specifically against that backdrop.

    If thats the case, then 0% interest and flat or minimal growth are here to stay. Nothing to make house prices crash, although I'm sure they will continue to fall in real terms. When I get back to the UK I will be buying outright or with a very small mortgage in a place I want to stay for the forseeable future so I would have no hesitation in doing so even though prices still appear high.

    I think the bond market could change things. IF we continue to have poor or no growth our debts will continue to mount. The national debt is unsustainable and at the tipping point. If ratings downgrade and again....we will see a rise in govt borrowing costs and then the cat is out of the bag. Japan is different in that they mainatain alarge manufacturing base and have citizens happy to buy a very large proportion of their own govt debt. Not so here...

  4. maybe funding for lending can be renamed the printing for stealing scheme...seems more acurate somehow.

    Yep, it is theft from savers and pensione providers. It is imaginary, unearnt wealth being used to prop up property rpices and in fact carry on a bubble that should have burst, but continues to deflate slowly and dangerously. It is the provision of what the market would not and could not do because the bubble should be defalting. In the hope that somehow the whole property market will start to resurge ( even though it has not adjusted downwards to any sort of sensible value), this money is produced from thin air. It so misguided, I too cannot believe any Conservatives would back it!

    It will do long term damage to the economy and our competitiveness will be affected, causing slower growth and a lesser prospect of ever paying back our national debt, now heading toweards £1,200,000,000. We are still adding to it at a rate of about £120 bn per year and it may even be getting worse again.

    All it would take is for the markets to ose faith in the UK's ability to manage this and rates would rise very rapidly to 4 or 5% where we can no onger service the debt - currently paying about 2% it is giving us a false basis for this debt in the longer term.

  5. http://www.guardian.co.uk/money/2013/feb/02/property-divide-house-price-casino

    "Ten years ago, a budget of £150,000 would pay for a new-build executive detached home in Hartlepool, or a run-down terrace in Hackney, east London.

    In December 2002 the buyer of the Hartlepool house, which is in Clover Drive and part of a pleasant estate, paid £143,950. In October 2012 it was sold for just £124,999, a 13% drop.

    But the property gods smiled on Hackney. A five-bed terrace in Cecilia Road sold for £150,000 in April 2002. In October 2012 it sold for £716,000 – up 377%."

    Add on stamp duty+fees and thats 3/4 million quid for a crummy mid-terrace in Hackney. Crack shack or mansion?

    Now that's what I call a bubble! It's ripple extends right across the south of England.

  6. Don't all attack me at once but.

    I think some of the money that has been printed (QE) can be disregarded from the debt/ deficit.

    I know it still sits on the balance sheet. But it would get worse press if they just cancelled it out.

    It is as it is.

    That is where we make our currency into Mickey Mouse money! Print it/make it appear on the Bank of E computer screen, pay off your monthly overspend with it. If you and I did that, we would go to prison for a fraud. The money markets are only a few steps away from changing their tune - we are 'on watch' and the real opinion is we are entering the danger zone very soon if the economy does not start to grow convincingly.

    That is why we do not disregard the QE entirely. The more there is the more we distort the real economy. Savers and pensioners and bond prices are all affected.

  7. Sorry, but they haven't achieved what they set out to do. They're trying to re-inflate the credit markets with an excess of printed money. In effect, treat a debt deflation as if it were a liquidity trap.

    It isn't, the problem is insufficient demand not insuffcient liquidity. That's why, despite the unprecedented scale and duration of these interventions, core inflation is soaring, GDP growth is non-existent and the velocity of money has fallen to a 60 yr low.

    money-velocity1-13.png

    The low velocity of money is the only thing which has capped inflation from soaring ....even to Weimar Republic levels. The level of debt in the usa and Britain is approaching the Weimar level before inflation took hold.

  8. I for one have been banging on about this on here for years....I have said the national debt is rising and we will be lucky to ever stop it. We are only still viable whilst interest rates on Govt debt remains at 2%. Imagine if it was 4-5%??!! We are then already at a level of debt where it cannot be paid back and we will be bust for real. That is how dangerous a level it has reached. The interest payments would be more than any so called reduction in the monthly deficit, which itself adds every month to the national debt. IT IS NOW THE WORST NATIONAL DEBT SINCE THE SECOND WORLD WAR. THE DEFICIT IS STILL A MASSSIVE AMOUNT EVERY MONTH AND SHOWS SIGNS OF ACTUALLY RISING AGAIN!

  9. As has been pointed out many times on this board, the Fruit Ninja clearly stretched himself too thin studying Politics, Philosophy and Economics at Oxford and absorbed none of it.

    http://www.telegraph...s-official.html

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    I for one have been banging on about this on here for years....I have said the national debt is rising and we will be lucky to ever stop it. We are only still viable whilst interest rates on Govt debt reamin at 2%. Imagine if it was 4-5%??!! We are then already at a level of debt where it cannot be paid back and we will be bust for real. That is how dangerous a level it has reached. The interest payments would be more than any so called reduction in the monthly deficit, which itself adds every month to the national debt. IT IS NOW THE WORST NATIONAL DEBT SINCE THE SECOND WORLD WAR. THE DEFICIT IS STILL A MASSSIVE AMOUNT EVERY MONTH AND SHOWS SIGNS OF ACTUALLY RISING AGAIN!

  10. This would be hilarious if it happened (which it won't).

    He can be no more than a stalking horse!

    The PM is under threat on the quiet. The polls are against him. People do not actually like the Coalition. IT's not tory govt, just a mish mosh of directionless policies. They will and are failing on the reduction of the deficit. The dent mountain will soon be so high that the interest costs will be too expoensive to bear. Any sort of bond crisis and interest rate rise for bonds will be the end!

    Mr Cameron thinks that simply offering a distant vote on the EU will give him extra votes. I think people want the EU vote on or before the next general election. They do not want to be told 'you will have to vote tory' to get it! Mr Cameron claims the EU is changing so 'we don't know' wat we'd be voting for at the moment. That is such rubbish and so condescending to talk to the elctorate in this way. We all know what the Eu is becoming - the UNITED STATES OF EUROPE, with a European president. Period! We would have little feeling of democracy if we got sucked into that. You will have to join the Euro and obey laws amde up somewhere else on an ever increasing scale.

    It's a free trade area we should want and NOTHING ELSE ATALL.

  11. A Tory member friend of mine told me recently that they see the house price crash of the 90s during a Tory government as one of the main contributors to being wiped out at the 1997 general election. They are therefore doing all they can to avoid repeating that and spending another 13 years out of power. Any Tory leader who allows a HPC will be crapped on by the the internal powers that be and the membership and end up with the joke reputation of John Major. Not an excuse for not doing the right thing of course, but goes some way to explaining a behaviour based fundamentally on fear.

    Pity..that's such rubbish. The house prices had normalised by 1995 and people were buying as normal at average 2.4 x income. The main fall in prices was 1990-93 and MR MAJOR WAS RETURNED TO POWER IN 92. He lost in 1997 because of boredom with the tories after 18yrs in power, a disunited tory front bench, sleaze stories and the old story of a New Labour - suave new liar/Blair.

  12. Clearly inferior to his own "religious belief" that printing money causes economic growth.

    I wonder if this is the same Andrea Leadsom MP who has a million pound BTL portfolio as discussed on HPC previously?

    LEADSOM'S DEBT IS HIGHER THAN THE ASSET VALUE = NEGATIVE EQUITY. NO WONDER SHE WANTS QE IN THE PROPERTY SECTOR - DIRECT.

    QE is utter madness - it will do nothing but debase our currency and stoke inflation. It cannot cure our pathetic growth and actually encourages poor or negative growth. The MPC is toatally misguided and history will one day prove it so. We are soon to reach the %og GDP borrowing figures which prompted the Weimar Republic to print vast amounts of money....then cam economic collapse .....and along came war.

  13. SEE THE SNIPPET FROM THIS ARTICLE... http://www.counterpunch.org/2013/01/17/how-central-banking-works/ AND ASK YOURSELF

    IS Mr Carney 'the 'best possible candidate' for the job of Governor at the B of E, or in fact a Keynesian nutcase hooked on aggressive QE which will do nothing but damage our UK economy, just as we are finding out that is exactly the kind of disaster he has helped along in Canada?

    "If you want to know why Canada’s housing market is headed for the shitter, look no further than Bank of Canada chief Mark Carney, the man who kept interest rates locked at 1 percent for 4 years despite the fact that Canadians’ debt-to-income levels have gone through the roof (higher than Americans at the peak of the housing bubble) and despite the fact that housing prices have more than doubled in less than a decade.

    Carney has kept the punch bowl brimming throughout his tenure at the BOC, which is why he’s been pegged to take over the top job at the Bank of England (BOE) next year. It’s because destroying Canada’s economy is an achievement that deserves to be rewarded. That’s how central banking works."

  14. It is all too real for retailers - they are suffering an internet caused implosion. Anything that can be bought online is taking trade away from shops on the ground. It will continue to be an adjustment we see for years to come.

  15. I thought the recession was over?

    It has barely begun! Honda sends most of the parts for cars 'made' in Swindon over from Japan. They are then assembled like kits on a conveyor. Then Govts claim we have a car industry. Honda has become increasingly uncompetitive - Japan's yen and their massive borrowing problems result in expensive parts. Cars cost too much for their segment and were beginning to have problems even before the recession. Fiat and others are already on 4 day weeks across Euroland.

    We have now achieved a Uk NATIONAL DEBT OF ABOUT £1.12 TRILLION AND RISING. IT will be £1.4 trillion by 2015. We cannot pay it back. We cannot afford even 2.5% rates for gilts going forward. QE solves nothing and in fact damages pensions and savers wealth.

    I WOULD LIKE YOU ALL TO PRESS FOR HIGHER INTEREST RATES - ITS THE ONLY WAY TO SANITY.

  16. Spot on.

    It's so SO misguided at the moment. Most of the extra cash the elite get to keep is going to be invested and spent outside of the UK anyway.

    VAT making everything more expensive for everybody, small businesses paying taxes big businesses all wriggle out of, and high rents/property prices are all things that need addressing.

    Labelling the unemployed as "shirkers" when they aren't any jobs to shirk from is misguided (but popular), but it's only going to get us so far isn't it?

    Yes, all absolutely right. Theere is no doubt that the policy of low rates for years has failed and is actually damaging and distorting the economy. Ashancellor I would take away rate setting powers from the BoE. They are harming our long term prospects. I would put rates for all land or property transactions back to 4% base rate over the next 6 months. I would have a separate base rate for business leanding for the time being, which would crawl upward very slowly in qtr point hops over about 3 yrs.

    I would put in a series of tax incentives for all manaufacturing and exporters of goods to encourage growth. I would, with immediate effect make all mortgages subject to a 2.5 X first income and 0.5 second income cap. I would change the law over residential tenancies - there would be a right to give a months notice at any time after the first 5 months and the length of an assured shorthold must be a minimum of 2 years. Landlords would only get a tenant out if they do not pay - 2 months in arrears and automatic possession order; and other issues as before.

    Income tax cuts? Not just now. Holiday homes - I would allow no mortgage relief against other income.

  17. I can't believe how popular that bellend Boris Johnson is either.

    (I've met Osborne Osbourne once btw. Well, when I say "met" I mean I had the misfortune of being in the same restaurant as him in the 90s. Possibly one of the most revolting individuals I've had the misfortune of sharing oxygen with.)

    I'm a conservative but cannot and will not vote for the rabble of public school d-heads on their front bench at the moment.

    Whilst I would never live in a rage of jealousy and believe people making money is fine and some inherited wealth is ok, the first posted comment does paint a picture of self repeating cushioned existence without enough meritocracy about it. They believe they can fix the debt problem by their current policies, which unfortunately is absolute nonsense and sadly they do not appear have any inkling about it. The Gov of the BoE thinks QE and low rates are essential when they are exacerbating our problems. Not only that they have appointed a mad borrower and QE exponent to be the new Gov OF BoE !! God help us all!

  18. Extract form

    http://www.lovemoney.com/news/savings-investments-pensions/savings/19115/governor-money-to-close-service?source=1000550

    Governor Money to close service

    Quote,

    "However, it has struggled to secure decent products in recent months. It says: “Unfortunately we have a scarcity of products to offer on the platform which, in the long term, goes against our original commitment to provide a range of products to choose from in order to get the best return for our customers.”

    Governor has blamed the Government’s Funding For Lending scheme, designed to kickstart mortgage lending, for its decision to wind down its service. Savings rates have plummeted in recent months as banks and building societies don’t need so much cash coming in from savers to lend to mortgage customers."

    The government are wrecking decent folks' savings and finances. They should stop meddling and let free market forces prevail.

    Yes, I agree. I believe base rates should move back to 4% over the next 12 months...but they won't. The govt has no guts whatsoever. The Keynesian experiment will be over at some point. World markets are going to start waking up this year to the size of debt the UK has and that it has no real prospect of repaying over even a generation.

    Cameron n Osborne, Dumb n Dumber

  19. barely any of their stock picks bare fruit, its just a magazine commenting on the weeks events and the blooming obvious.....

    Of course! it's all about circulation. But the eesential truth in their article IS: Interest rates will ris. Govt funding will become unsustainable. There will be a new financia l crisis in due course. It amy play out slowly like Japan or we have may a masssive shudder to go through. There will still be a Britain at the end of it though.

  20. http://www.bbc.co.uk/news/uk-politics-20935599

    It's reached a damned if you do and damned if you don't scenario if you ask me.

    YEP. You won't be right whatever you do anymore. The fact is that artificially low rates will cause distortions and have a negative effect in the long term. We ARE experiencing slow growth, high home prices, low savings returns, high rents/housing ben payments - etc etc - precisely because the govt and B of E are so gutless they can't see that this phoney money world is more damaging than anything else. There is more than a grain of truth in the article however it may play out in the end. It could be another 5 yrs of QE and then pop; it could all pop this yr with a massive stock market reversal; you could see no effect atall for 7 years except poor growth and increasing national debt/ lower and lower debt ratings until ...bang, the bond collapse, the IMF can't cope scenario.

    The idea that another alternative exists - namely that we and others grow out of this crisis and begin to pay our way seems the remotest possibility of all....but...there is a tiny chance of that too.

  21. In other news horseshoe makers have all but disappeared, due to people switching from horses to cars in the past 100 years.

    Launderettes have been decimated due to the fact that most people have washing machines at home.

    The BBC is insightful as usual... :rolleyes:

    ---

    Yes, and bookshops are dying out along with many other things we will in future do online. There is a confusion about the recessionary feel and the problems with on the street retailing. The latter is suffering from some lower spending but it is changing forever because of online retailing. Best invest in courier companies (until the molecule/ matter movement machines come on tap) . In fact robots will rpobably drive vehicles and deliver goods within 100years.

  22. How many more "dips" will it take before they're forced to admit it is one giant depression?

    Maybe then it'll dawn on them that it's their ridiculous bank bailouts and housing market props that are causing this never ending depression.

    That really would be the 'Breaking Dawn' and not a vampire in sight!

    There is curently no understanding in govt of the role of profligate private and public borrowing causing an imaginary wealth bubble including house/land values AND THE damage it has wreaked on us all. The idea that rising house values automatically connotes an improvement at this time is in fact the problem. We would benefit from a rise in interest rates - the house market would reform to sensible levels, savings would be be rewarded, rents would fall, HB would fall, stagnant wages would go further, our competitiveness would revive, jobs would be created, dead wood would go, balance of payments would recover further, the real cost of living would fall dramatically, young people could save up and....yep, buy a home. The market would soon stabilise. We could even concentrate on reviving manufacturing...mind you pigs might fly. ...banks might revolt.

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